Impressive Growth In The Smokeable Products Segment Helps Altria Beat Estimates
Highlights Of The Quarter:
1) Impressive Growth In The Smokeable Products Segment
- Revenues, net of excise, grew 5.3%, benefiting from cost cutting measures and higher pricing.
- Margins also improved as a result by 170 basis points, to 48.1%.
- Despite moderate cigarette industry volumes declines, Altria managed to increase volumes, due to market share gains and an additional shipping day.
- Growth in retail share was witnessed in the discount brands, led by L&M.
2) Higher Prices And Improved Margins Lead To Growth In The Smokeless Products Division
- Higher net pricing and greater volume helped in the growth of this segment.
- The national expansion of Copenhagen Mint also aided in higher volumes.
- Copenhagen was the fastest-growing smokeless brand and the largest, growing its retail share by 1.1 percentage points to 32.4%.
- In e-vapor, Nu Mark continued to increase the distribution of MarkTen XL, with early marketplace results being encouraging.
- Altria is working with Philip Morris on an FDA application for iQOS — a product using the heat-not-burn technology.
3) Full-Year Guidance Was Reaffirmed
- Guidance of a full-year adjusted diluted EPS of $3-$3.05 was reaffirmed.
- It does not include any impact of the proposed AB InBev-SABMiller merger.
- Despite an impressive quarter, the guidance was not raised, mainly due to a possibility of higher state excise taxes.
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Have more questions on Altria? Have a look at the links below:
- How Will Altria Perform In Q1 2016?
- What Are Altria’s Strengths Driving Long-Term Growth?
- What Are Some Obstacles To Altria’s Long-Term Growth?
- How Will Altria’s Revenue And EBITDA Change In The Next 3 Years?
- How Has Altria’s Revenue And EBITDA Composition Changed In The Last 5 Years?
- Altria: Year 2015 In Review
- How Has Altria’s Shipment Volume, By Brand, Changed Over The Past 3 Years?
- How Has Altria’s Retail Share In Smokable Products And Smokeless Products Changed Over The Last Year?
- What is Altria’s Revenue And EBITDA Breakdown?
- What is Altria’s Fundamental Value Based On Expected 2016 Results?
- By What Percentage Did Altria’s Revenue & EBITDA Grow In The Last 5 Years?
Notes:
Global Large Cap | U.S. Mid & Small Cap | European Large & Mid Cap
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